Environmental, social, and governance

Abstract

How do effective directors ensure that their organisation’s pose is being channelled for the wider benefit of society? Based on a framework of global corporate governance best practice, which can be used in all organisations anywhere in the world, this chapter of Questions To Ask (QTA) in the boardroom gives a high-level but succinct introduction to environmental, social, and governance (ESG). ESG refers to the three categories that enable organisations to measure the real sustainable and societal impact of their outputs. These impacts can be measured in terms of cost and quality, use of natural resources, and whether there are negative side effects for society or the environment which need to be mitigated. Making sure that the organisation is effectively considering, addressing, and reporting on its social and environmental responsibilities and performance is very important to its success and to building the trust with different elements of society on which such success ultimately depends. The chapter’s introduction leads into the key Questions To Ask in the boardroom, giving the reader further insight into how to initiate discussions about organisational ESG practices.